Tradingview has deleted all of my drawings on the BTCUSD Bitfinex chart so I have to start fresh (THANKS OBAMA).
BTC currently in a 4hr equilibrium pattern after encountering several EMA and MA resistances on the daily and weekly timeframe as I mentioned in my last BTC post. I have drawn a potential rising wedge with two potential top boundaries. Throughout the pattern we are still seeing overall decreasing volume, and the recent attempt to break out of the pattern was not accompanied by a convincing increase in bull volume (note that the one huge green candle was most likely short-term manipulation shenanigans because it occurred in only a few minutes and it saw no bull followthrough). The black trendline is still acting as resistance, but we now have several 4hr and daily EMA supports down to 6750 to try to hold. If we break bull from the equilibrium it will probably signal further bullish action as we try to find a lower high on the weekly compared to 8506. If we break bear i will scale out of my current short as we get closer to the lower boundary of the wedge.
Daily rsi rejected from 60, which is a nice resistance level to look out for when in a downtrend, and the daily Stochastic which was overbought has had a bearish DK cross, but is still in overbought territory. 4hr Stochastic has crossed bearish and is coming down from overbought levels. 4hr rsi broke a trendline bearish, backtested, and rejected.
If you are anticipating one of the wedges to play out, there are a few scenarios. If playing the larger wedge with the black upper boundary, then we are still watching the pattern form. If you are looking at the wedge with both blue boundary lines, we could have just seen what cryptosniper refers to as a “pop out the top” of the wedge which can lead to a sharp bear move out of the bottom of the wedge, or it can revisit the inside of the wedge and then break bull again. Check out his youtube videos from the past couple of months for more discussion about his rising wedge theories.
Altcoins have been a nice leading indicator recently for BTC direction when in an equilibrium pattern. Iota, Neo, and Litecoin were all breaking bull from their equilibriums before btc broke bull a few days ago. Currently, many are breaking bear.
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